Martech is consolidating, but what will the 2022 landscape reveal?

Martech Acquisitions 2019-2020
Next Tuesday, May perhaps 3 — Martech Day! — we’ll release the 2022 advertising technology landscape, together with a State of Martech report. You can be just one of the very first to see it and find out about the key trends it reveals by joining Frans Riemersma and me for a dwell webinar at 11am Eastern. You can sign up for free of charge in this article.

You may well already be leaping to a summary. “It would seem like every other week, I read through about a big acquisition. Certainly the 2020 martech landscape with its 8,000 remedies was Peak Martech! The only issue is by how much has the 2022 landscape shrunk.”


Certainly, the martech business sees a huge quantity of M&A exercise. LUMA Companions, one particular of the top financial investment banking companies in martech — and the creators of the authentic adtech landscape that inspired us around a 10 years in the past — publishes quarterly stories of recognised offers. There had been 157 in 2019, 85 in 2020, and 166 in 2021.

About one particular out of every single five of people was a offer valued at $100 million or more. Such huge acquisitions virtually always make the information. Final 12 months, there had been 37. On typical, that is 3 for each month that very likely garnered headlines in field publications.

It is a testomony to just how substantial the martech industry is that so quite a few sizeable acquisitions are continuously developing. All all those headlines in a natural way give the impression of significant consolidation.

But although that consolidation is authentic, as a proportion of the overall selection of martech methods, these regarded acquisitions are 2% or so of the total landscape. In the meantime, new martech startups and other much more set up providers continue to enter the space. Ironically, consolidation is normally a catalyst for far more software package to be established.

Martech Platform Leverage

Consolidated platforms make it simpler for computer software builders to make apps on top of them. If you’re standing on the shoulders of giants, the greater the huge the better. And the less giants you have to decide on among, the much better way too, as it is additional probably it is that the a person(s) you decide on will have scale and staying energy.

These favourable responses loop dynamics — often framed as “winner will take all,” even if in reality there are usually many major winners — is why AWS, Microsoft Azure, and Google Cloud are so dominant as cloud platforms. And they’re however rising at a remarkable speed. But in the procedure, they’re birthing millions of apps created on best of their foundations.

The increase of ecosystems and marketplaces in SaaS corporations more allows the Cambrian explosion of industrial expert apps as perfectly as tons of customized apps personalized to particular person corporations. They assistance resolve the issues of discovery and integration.

In the meantime, desire for specialized software program proceeds to develop also, as reported by the selection of SaaS applications that firms have in their stacks:

SaaS App Adoption

We’re moving into a publish-digital-transformation period, wherever businesses are no more time preparing to come to be “digital.” They are electronic. And as they now compete ferociously for aggressive advantages in their electronic functions and electronic customer activities, they are significantly relaxed obtaining and making far more specialised computer software.

Marketing stays 1 of the most intensive domains in which that competitiveness takes place — providing martech entrepreneurs enough prospects to build value.

Traders continue to believe that in these chances as well. They carry on to fund new and rising martech ventures. If you decide up a duplicate of LUMA’s Q1 2022 Sector Report, you’ll see the hundreds of hundreds of thousands of pounds in funds put into martech companies just in the initially a few months of this year.

That mentioned, there are rational limits for how a lot of martech firms can exist at one time and how quite a few martech applications any one particular firm can usefully adopt. Though new martech items are continuously born, previous kinds fade away into mergers, pivots, and discontinued oblivion.

The queries the martech landscape has answered each individual yr are: (1) what is the balance among martech expansion and consolidation and (2) what’s the composition of answers in the overall martech business? Those people responses reveal a ton about the ongoing evolution of marketing and advertising.

What will the 2022 martech landscape reveal? Tune in future Tuesday to discover out.

We’re going to release a little something seriously distinctive this yr that I warranty you will want to be a single of the first to have access to.

P.S. Researching the martech landscape has turn out to be a task of epic proportion above the several years. And with the particular shock we will be unveiling this year, the effort and hard work to deliver it has developed even extra. We would not have been ready to do this without the money support of a number of generous sponsors:

If you haven’t taken a look just lately at the impressive martech alternatives these organizations are developing, check them out. It is extraordinary.

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